How often does some version of this statement get uttered in your organization’s A/P department? “Somebody created a duplicate vendor” or “Somebody put the tax id in wrong”
Have you ever wondered who hired this “somebody”? This vague person always seems to be responsible for things going wrong. I think we all know that, really, using the term “somebody” is almost the same as saying “nobody”. The one thing that it does reveal is a lack of responsibility and accountability for the Vendor Master Files. By addressing the areas in which accountability is lacking, A/P managers can prevent “somebody” from wreaking more havoc.
Part of any comprehensive Vendor Master File process should include a clear understand of who is responsible for creating, maintaining or updating any file. By determining ownership for each piece of the system, a verifiable segregation of duties is in place, lessening the chance for errors and fraud.
While there are a good deal of items to consider, make sure these points are addressed: Who owns the Vendor Master File? A/P or Purchasing? Is there a documented procedure in place for creating a new Vendor Master File? Is there a company-wide form in place to facilitate this procedure? Who is responsible for changes and updates? Who then monitors those changes? Are you ensuring that those who can create a Vendor Master File cannot also enter or pay an invoice? Does your system allow for tracking levels that show which employee made changes so that if they are done incorrectly, the appropriate training is completed? Have the appropriate configurations been made to your ERP system to utilize its full tracking capabilities?
Answering these questions will pay significant dividends in the future, through risk aversion and the ability to properly re-train the staff when errors do occur.
To know more, join Karl Andersson, CEO of Technology Insight in a series of webinars dedicated to Best Practices in Accounts Payable. Click here to view the list of upcoming webinars